M&As by Chinese multinational enterprises in developed economies: strategic asset seeking and bundling

The extant literature argues that Cross-Border M&As (CBMAs) by Chinese Multinational Enterprises (CMNEs) in developed economies are motivated by Strategic Asset Seeking (SAS). However, a more detailed look at the specific strategic assets is often missing. This study investigates which specific strategic assets CMNEs search for, based on the strategic assets that they already possess, and how assets from the acquiring and the acquired companies are bundled after acquisition. By analysing 12 CBMAs, through the perspectives of both the acquired and the acquiring firms, we demonstrate that the interplay between existing country-specific and firm-specific assets enables CMNEs to bundle their existing assets with complementary Western assets. We also provide empirical evidence that technology transfer between CMNEs and Western targets occurs in both directions, and that Chinese acquirers and their target firms both employ joint innovation to upgrade technologies and enhance product offerings.